Short Term vs Long Term Renting: Pros and Cons
Purchasing a second property in addition to your primary residence gives you the chance to generate passive income. There are two options for rental owners: short-term rentals or long-term rentals. Both have benefits and drawbacks; continue reading to find out more about them so you can decide which is better for you. Your choices will also be influenced by your interests and way of living.
Purchasing a second property in addition to your primary residence gives you the chance to generate passive income. There are two options for rental owners: short-term rentals or long-term rentals. Both have benefits and drawbacks; continue reading to find out more about them so you can decide which is better for you. Your choices will also be influenced by your interests and way of living.
Long-term rentals come with guarantees of profit, peace of mind, and invested renters, among other advantages. Contract lock-in, a lack of control, and damage risk, on the other hand, are disadvantages. Before making a final decision, carefully weigh all the advantages and disadvantages; don't forget to take your tastes and way of life into account.
Short-term rental: PROS
User use
Possibility of using the rental for personal needs is another advantage. With the exception of two weeks during the peak season when you and your family can use it, if your rental is in a well-liked vacation location, you can rent it out all year long.
Greater profit
Statistics show that short-term rental of a home can increase your profit by as much as 60%. According to some estimates, a long-term rental property earning £1000 may make up to three times as much by being rented temporarily.
Flexibility
The flexibility is the following major advantage. You can have more control over your short-term rental if you sublet it. When and how long the property is offered for rent is up to you to determine.
Short-term rental: CONS
Regular cleaning
Weekly visitors need a lot of cleaning, dusting, and vacuuming. There will also be washable bedding and linens available. If you don't mind performing these common household tasks, you can complete all of these tasks on your own. You can always hire someone to do it for you if you don't have time to do it yourself. Charge a cleaning fee to recoup your expenses.
Spending money on marketing
Due to the high guest turnover associated with short-term rentals, marketing is necessary to draw in new guests. Utilize the many internet marketing and social media tools at your disposal while maintaining your listing's visibility on the right sites.
Being accessible
The largest disadvantage of short-term rentals is having to be available at all times. You must be accessible around-the-clock to greet visitors and address their questions.
Long-term rental: PROS
Tenant investors
When you have long-term tenants living on your home, they are usually far more invested in maintaining it. They frequently try their best to keep it correctly maintained since they would be residing there for a while.
Income assurance
The first advantage of long-term rentals is guaranteed income, which is not the case with short-term leases. Long-term rentals have a guaranteed revenue that is spelled out in the contract, despite the fact that short-term rentals have higher rates.
Tranquilly of mind
The valuable gift of peace of mind is another significant advantage. You don't need to worry about marketing your property when you have long-term tenants. Additionally, you can unwind knowing that your property is occupied for a specific amount of time. It requires less work on your part as the property owner.
Long-term rental: CONS
Absence of control
The loss of control is another negative. You cannot enter the property if you are not one of the long-term renters. You entrust them with taking care of the property.
Damage possibility
Last but not least, long-term rentals come with a danger of damage because you can't check on the property anytime you want. Appliances, walls, and flooring may experience wear and tear from tenants. To protect yourself, you should put a damage provision in the contract and demand a deposit.
Locked-in contracts
The first issue that comes to mind when thinking about the disadvantages of long-term rentals is contract lock-in. Despite the fact that there has been a lot of change in your life, once you sign that contract, you cannot reverse it without facing legal repercussions. Thus, it's not always the best. Undoubtedly, there is not enough flexibility.